This Adam Smith quote is often used to emphasize the evil and collusive nature of “big business.” Unfortunately, like so often happens in these instances, everyone forgets the rest of the quote.

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.

Smith wasn’t advocating for anti-trust legislation; he thought such laws were unenforceable and inconsistent with liberty and justice. Rather, Smith cautioned against government mandated collusion.

I can add a million examples. Hair braiders are stepped on by the government in collusion with licensed beauticians. Taxi companies get the government to quash low-cost or innovative shuttle transportation. Discount casket companies are banned by government in collusion with undertakers. Take dentistry. Why do I need to go to an expensive dentist when 99% of my dental needs could be served by a hygienist alone? Because the government colludes with dentists to make it so. And don’t even get me started on medicine. My guess is a huge percentage of the conditions people come into emergency rooms with are treatable by someone without a 4 year medical degree and 6 years of internship. Does one really need a full medical education to stitch up a kids cut knee? Well, yes, you do today, because doctors collude with the government to make it so. Why can’t people specialize, with less than 10 years of education, on just, say, setting bones and closing cuts? Why can’t someone specialize in simple wills or divorces without a full law degree?

As Adam Smith clearly saw, the real danger is not collusion between business men and business men, but collusion between business men and government. Government is so much more dangerous because it is always done “for our own good.”

Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies, The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end, for they do so with the approval of their own conscience.

Adam Smith was looking at the 18th century, before the kings would have dreamed of trust-busting. If you extend his basic structure to the 19th century, it’s brazenly clear that large trusts/monopolies that didn’t exist in his day are a much larger threat to the economy than beauticians, and there have been times with government intervention made our economy much, much more competitive. The 21st century US seems to give us the worst of both: government far too involved in creating monopolies rather than breaking them up. Though I do totally agree with you that any kind of licensing for beauticians should be nonexistent or super-minimal, why are we arguing? What is the point of trying to figure out if the banks all buying each other, or beauticians forming what Smith would have seen as an anti-competitive guild, is the bigger problem, and then ordinary people screaming at each other about that question. Why are we fractured into two teams: there’s no real way to imagine a government that can’t regulate dentists, for example, and I don’t know anyone on the right taking on the dentist lobby. Those of us who want to break the banks down to competitive sizes are waiting for you: stop arguing about what is worse, find it, let’s get a list of 20 government-worsened monopolies (taxis are an obvious one) and gather the political strength to break the beauticians, dentists and taxi lobbies, and the banks and telecoms collusion and anti-competitive mergers at the same time.